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2014
2014
AN EVEREST GROUP REPORT
AN EVEREST GROUP REPORT
2014 AN EVEREST GROUP REPORT Analytics in Pharma and Life Sciences Overcoming Challenges in Data Integration,

Analytics in Pharma and Life Sciences

Overcoming Challenges in Data Integration, Stakeholder Collaboration, and Talent/Technology Investment to Operationalize Analytics in Pharma and Life Sciences

AbhishekMenon,PracticeDirector

AnupamJain,PracticeDirector

Copyright©2014,EverestGlobal,Inc.Allrightsreserved.

Copyright©2014,EverestGlobal,Inc.Allrightsreserved.

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ThisreporthasbeenlicensedforexclusiveuseanddistributionbyGenpact research.everestgrp.com EGR-2014-12-R-1160

EGR-2014-12-R-1160

ANALYTICS IN PHARMA AND LIFE SCIENCES Executive Summary Thepharmaandlifesciencesindustryisfacedwithincreasingregulatory
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

Executive Summary

Thepharmaandlifesciencesindustryisfacedwithincreasingregulatory

oversight,decreasingResearch&Development(R&D)productivity,challenges

togrowthandprofitability,andtheimpactofdigitizationinthevaluechain.The

regulatorychangesledbythefar-reachingPatientProtectionandAffordable

CareAct(PPACA)intheUnitedStatesareforcingthepharmaandlifesciences

industrytochangeitsstatusquo.Besidestheincreasingcostofregulatory

compliance,theindustryisfacingrisingR&Dcosts,eventhoughthehealth

outcomesaredeteriorating.Ledbytheregulatorychanges,thecustomer

demographicsarealsochanging.Thegrowthisbeingdrivenbyemerging

geographiesofAsiaPacific(APAC)andLatinAmerica(LATAM).Asaresult,the

pharmaandlifesciencesindustryiscompelledtofocusontheserelatively

nascentandevolvingmarkets.Conceptsofcloud,mobility,andsocialmedia

areenablingorganizationstorationalizeinternalcosts,facilitateintegrationof

informationandprocessesacrossdepartments,andfocusonbetterprofiling

andtargetingofclientsandmedicalpractitioners.

Theindustryisviewingtheincreasedregulatorysupervisionasaburden.

However,theregulatoryrequirementsareputtinginplaceafoundationfordata

requirementsthatcanbeusedtodrivepharmaandlifesciencesanalytics.

Organizationscanextractadditionalvalueinachallengingmarket,andcreate

competitivedifferentiationbyutilizingthisopportunity.

Applicationofpharmaandlifesciencesanalyticsrangesfrombasicreporting andinternaldashboardcreationtohigh-endpredictiveandprescriptive

analytics.Thekeyapplicationsofanalyticsinpharmaandlifesciencesinclude regulatorycompliancereporting,marketing/salessupport,andproduct/service enablement.Thethird-partyanalyticsservicesmarketforhealthcareisexpected

toincreasebyoverfivetimesitscurrentsizeby2020.

Today,however,themarketisstillinafairlynascentstageandthereare

significantchallenges,suchaspoordataintegration,lackofinvestmentin

talentandtechnology,andlimitedstakeholderalignment,impactingthis

industry.However,thebestpracticesareemergingtohelpovercomethese

challengesandpushpharmaandlifesciencesanalyticsfurtheronthepathof

rapidgrowth.

Thispaperdescribesthe“artofthepossible”inanalytics,specificallywithinthe

contextofhowitaddsvaluetothepharmaandlifesciencesindustry.Thepaper

focuseson:

Pharmaandlifesciencesindustrychallengesandopportunities,where

analyticsplaysarole

Rangeofanalyticsleveragedinpharmaandlifesciencesindustryand

examplesofhowitcreatesvalueforthebusiness

Criticalchallengesandtheemergingbestpracticesinoperationalizing

analyticsinthepharmaandlifesciencesindustry

2

Benefits

Improvementinregulatory compliance/internal reporting

Increasedtimelinessand accuracyofPVregulatory

reportingtoover90%

Bettermarketing/salessupport

300%increaseincross-/

up-sellopportunityand

alsoincreasedcustomer

conversionrates

Product/serviceenhancement

Dropinreadmissionrates,

especiallyforcritical

ailments

Keys to operationalize customer analytics

Embrace analytics-driven decision making

Standardization and digitization of data

Leverage third-party providers

Increasing Intra-group collaboration

Fast reference

Executive summary

2

Key drivers

3

Impact of analytics

6

Operationalizing analytics

9

Conclusion

12

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ANALYTICS IN PHARMA AND LIFE SCIENCES Drivers of Analytics in Pharma and Life Sciences
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

Drivers of Analytics in Pharma and Life Sciences

Thepharmaandlifesciencesindustryisundergoingtectonicshifts.Introduction ofthefar-reachingPPACAintheUnitedStatesandothersimilarregulations acrosstheglobearenotonlychangingtheregulatoryframework,butarealso impactingthecostandrevenuepotentialof thehealthcarepayers,providers, andpharmaceuticalfirms,specificallyaroundR&Dproductivityandtheabilityto drivegrowthandprofitability.Additionally,theimpactofdigitizationonthevalue chainisaddinganadditionaltwisttoanalreadycomplexandtoughindustry

(seeExhibit1).

Compliance

Evolvingstringent

regulatoryenvironment

Risingcostofcompliance

R&Dproductivity

RisingR&Dexpenditures

FallingFDAapprovals

Static/deterioratinghealth

 Significantriskofnon- outcomes compliance Driversof analyticsinpharma andlifesciences Valuechaindigitization
 Significantriskofnon-
outcomes
compliance
Driversof
analyticsinpharma
andlifesciences
Valuechaindigitization
Profitablegrowth

Increasingcloud-based

servicesandmobility

solutions

Proliferationofsocialmedia

Innovativeandcustomized

delivery

Lossofpatentexclusivity

Needforglobalization

Newcustomerdemographics

Risingcompetition/industry

consolidation

1.Compliance

Theregulatoryframeworkofthepharmaandlifesciencesindustryisundergoing

significantchanges.TheintroductionofthePPACAandothersimilarregulations

acrosstheglobeareleadingtoincreasedscrutinyoftheindustry.

Besidestheobviouscostofcompliancetoregulationsandthepenaltiesfornon-

compliance,theregulatoryrequirementsarebringingaboutfarreaching

changesintheindustry.Forexample,thePPACAisforcingtheindustryto

becomeoutcome-basedratherthaninput-oriented.PPACAis,overtime,moving

theindustrytoamodelofreimbursement,basedonhealthoutcomes.Drug

effectiveness(performanceinuncontrolledeverydaypractice)isbecomingmore

importantthandrugefficacy(measuredinatrialenvironment).

Theregulatoryregimealsodifferssignificantlyacrossgeographies,forcingglobal companiestoadheretomultipleregulatoryregimes.Forexample,thePhysician PaymentsSunshineAct(PPSA)makesitmandatoryfordrugcompaniestoreport alltransfersofvaluetomedicalpractitioners.Ithasequivalentandmore stringentprovisionsinEuropeancountries.Pharmacovigilance(PV) 1 reportingis governedbyglobal,regional,andcountry-specificregulationsthatmustbe adheredto,inordertooperateacrosstheworld.

E X H I B I T

1

Drivers of analytics in pharma

and life sciences

Cost of regulatory compliance The Center for Medicare & Medicaid Services (CMS) estimates that the cost of compliance for the Sunshine Act (introduced under the aegis of PPACA) would be US$269 million, with subsequent years costing US$180 million to the broader pharma and life sciences industry

Cost of non-compliance Timely and accurate reporting is critical for the Sunshine Act, as non-compliance penalties range from US$10,000 for each payment not reported (subject to a maximum of US$150,000) to US$100,000 for knowingly withholding information (capped at US$1 million)

1 PVisthescienceofcollection,detection,assessment,monitoring,andpreventionofadverseeffectswithpharmaceuticalproducts

3

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ANALYTICS IN PHARMA AND LIFE SCIENCES 2.R&Dproductivity Worsening health outcomes in spite of increasing healthcare
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

2.R&Dproductivity

Worsening health outcomes in spite of increasing healthcare costs

Adverse event reports to the

FDA increased at 4% CAGR

from 2003 to 2011, while

serious/death outcomes

increased at 16% CAGR in

the same time frame

The cost of drug development

has skyrocketed by more than

400% in less than 20 years

New customer demographic There are an estimated 30 million Americans without health insurance, who need to get enrolled by March 2014 to avoid a penalty in their 2014 tax return

TheincreasedregulatoryoversightisleadingtoariseinthecostofR&Dfor

drugdevelopment.TheincreasinglystringentU.S.FoodandDrug

Administration(FDA)guidelinesarealsoleadingtoalowerrateofapprovalfor

newdrugs.Inspiteofthisincreasedsupervision,healthoutcomesareatbest

staticordeteriorating,forcinghealthcarepayerstomovetowardsanoutcome-

orientedreimbursementregime.AffordableCareOrganizations(ACO)created

undertheaegisofPPACAhavestartedtofocusmoreonhealthoutcomesand

will,infact,bereimbursedbasedontheoutcomesandfeedbackfrompatients.

Overtime,allhealthcareprovidersandpharmaceuticalfirmsareexpectedto

graduallymovetowardsanoutcome-orientedregime.Healthcareproviders

andpharmaceuticalfirmsarealso,then,forcedtoidentifycostoptimization

measurestoreducecostswhiledeliveringbetterhealthoutcomes.

3.Profitablegrowth

Thepatentprotectiononmanyoftheblockbusterdrugsintroducedover

previousyearshasexpired,leadingtoincreasedcompetitionfromgenerics.

Thenewhealthcarereformiscreatingalargeopportunitybyopeningupthe

markettoanewdemographicofcustomersthathastraditionallybeen

underservedbythepharmaandlifesciencesindustry.Thetraditionaland

maturemarketsofNorthAmericaandEuropearegettingsaturated,andthe

newgrowthisbeingdrivenbyemerginggeographiesinAPACandLATAM.The

industryneedstoglobalizeinordertofulfillthisnewdemandandmeetits

growthobjectives.

Pharmaceuticalfirmsareincreasinglylookingtoacquisitionstomanagethe

increasedcompetition,enternewmarkets,andcombatthethreatfrom

generics.Thisisleadingtoawaveofconsolidationinthepharmaceutical

industry.

4.Valuechaindigitization

Theadventofcloud-basedservicesandmobilitysolutionsofferpharmaceutical

firmstheabilitytorationalizeinternalcosts,increaseagilityinrespondingto

clientneeds,andfacilitateanintegrationofinformationandprocessesacross

R&D,regulatorycompliance,marketing/sales,andcustomerservice.

Theproliferationofmediaingeneral,andsocialmediainparticular,is increasingthepublicscrutinyontheindustry.Drugrecalls/adversereactions arereceivingsignificantattention.Thepharmaceutical-medicalpractitioner relationshipisunderextremepublicscrutinyduetotheinformationbeinginthe publicdomainasmandatedbyPPSA.Customersarealsoleveragingthedigital mediatotakehealthcare-relateddecisions.Asaresult,ithasbecome imperativefortheindustrytohaveawell-thoughtoutdigitalmediastrategy

(seeExhibit2).

4

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ANALYTICS IN PHARMA AND LIFE SCIENCES E X H I B I T 2 Need
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

E X H I B I T

2

Need for digitization across the pharma and life sciences value chain

N OT EXH AU STIVE Drugdiscovery/ Clinicaland Manufacturing Supplychain& Marketingandsales research
N OT EXH AU STIVE
Drugdiscovery/
Clinicaland
Manufacturing
Supplychain&
Marketingandsales
research
pre-clinicaltrials
operations
distribution

Cloud-basedsimulation

Electronicdata-capture

SynchronizingERPand

models

systems

informationsystems

Model-outcomestesting

Pharmacovigilance-

Facilitateregulatory

drivenprocess

compliance

monitoring

 

Socialcollaborationwith

Usage-based

stakeholders

Mobileclinical-trial

informationmanagement

management

solutions

Mobility-drivenreal-time

 
 

electronicresearchdata

Unifiedplanning,setup,

Centralizedbatch

exchange

&executionofclinical

monitoring

trials

 

Cloud-basedportalsforassembly/testingremotely-

collectedresearchandtrialdata

Social-mediapresence andengagement Patientandphysician outreach Mobileapps Information dissemination
Social-mediapresence
andengagement
Patientandphysician
outreach
Mobileapps
Information
dissemination
Behavioralmarketing
Context-basedservices
Mobilityinitiativesand
promotionalcampaigns
Trackingsalesactivity
RFIDsolutions Electronicproductcode Remoteproduct monitoring Mobileanti-counterfeit drugsidentification
RFIDsolutions
Electronicproductcode
Remoteproduct
monitoring
Mobileanti-counterfeit
drugsidentification

Real-timetrackingof

logisticsand

transportation

Predictivemodelingto

optimizeorderfulfillment

BYOD

Socialmediaintegration

BundledPaaSsolutions

Cloud-drivencollaborationtoolstoengagestakeholders

Enterprisemobility

Informationbackupandrecovery

Theincreaseduseoftechnologyandtherequirementtogatherdataas

mandatedbyregulations,suchasthePPSA,providepharmaceuticalfirmsthe

abilitytobetterprofileandsegmentmedicalpractitioners,allowingforamore

targetedsalesapproach.Salesrepresentativescanbeenabledwithspecific

promotionalmaterialandapproaches,basedonthepractitionerprofile.

Similarly,onthecustomerside,alargervolumeofdataisavailablethrough

digitalmedia.Thisallowsformoretargetedmarketingeffortsbasedon

customersegmentationandprofiling.

5

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ANALYTICS IN PHARMA AND LIFE SCIENCES The Role and Impact of Analytics in Pharma and
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

The Role and Impact of Analytics in Pharma and Life Sciences

Analyticsisplayingakeyroleinhelpingthepharmaandlifesciencesindustry managetherapidlychangingenvironmentandbettermanagethechallenges. Whileadoptionofanalyticsisstillatafairlynascentstage,third-partyanalytics businessservicesisgrowingrapidlyandisexpectedtoincreasebyoverfive

timesitscurrentsizeby2020(seeExhibit3).

AnalyticsBPS 1 adoptionbyindustry

2013;RevenueinUS$billion

100%=2.0-2.5 CPG&retail 38% Healthcare, Others 2 8% pharma,and 6% lifesciences Media& 6% entertainment
100%=2.0-2.5
CPG&retail
38%
Healthcare,
Others 2
8%
pharma,and
6%
lifesciences
Media&
6%
entertainment
10%
6%
Professional
Banking
services
6%
10%
8%
Manufacturing
Insurance

Hi-tech&

telecom

AnalyticsBPS 1 industrysizeandgrowth inhealthcare,pharma,andlifesciences AnnualrevenueinUS$million

680-1,100

160-200 2013 2020E 23-27% CAGR
160-200
2013
2020E
23-27%
CAGR

1 AnalyticsBusinessProcessServices(BPS)representsthird-partyservicesoftheanalyticsindustryanddoesnot

includesizeofinternalanalyticsinitiativesand/orrevenueofanalyticsproductsfromcompaniessuchasSAS,

Oracle,SAP,andMicrosoft

2 Includepublicsector,travel&logistics,andenergy&utilities

Analyticalsolutionshavegrowntremendouslyoverthelastdecade,specifically, intermsoftheirsophisticationandtheresultingbusinessimpacttheycreate. Thereisawiderangeofanalyticssolutionsbeingdeployedinthepharmaand

lifesciencesindustry(seeExhibit4).Whilebasicreportingcontinuestobea

must-have,advancedpredictiveandprescriptiveanalyticsarenowstartingto

generatepowerfulinsights.

Relativematurityofanalyticssolutions

Percentageofthird-partyoffshoreanalyticsFTEs

11% Emerging areasof 4.Prescriptive interest analytics 24% 3.Predictive analytics 41% 2.Descriptive 24%
11%
Emerging
areasof
4.Prescriptive
interest
analytics
24%
3.Predictive
analytics
41%
2.Descriptive
24%
analytics
Mostprevalent
analytics
solutions
1.Reporting
Sophisticationofsolution
Businessimpact

6

Using analytics can reduce U.S. healthcare expenditure by US$200 billion. – The big data revolution in healthcare: Accelerating value and innovation. McKinsey & Company. January 2013

E X H I B I T

3

Size and growth of analytics BPS

in healthcare, pharma, and life

sciences

Source: Everest Group

E X H I B I T

4

Range of analytics leveraged in

pharma and life sciences

Source: Everest Group

EGR-2014-12-R-1160

ANALYTICS IN PHARMA AND LIFE SCIENCES 1. Reporting. Themostbasicversionofanalyticssolutionthatfocuseson
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

1. Reporting.Themostbasicversionofanalyticssolutionthatfocuseson

buildingdatarepositoriesandreportingthecurrentsituationusingsimple

anduni-orbi-variatedata.Typicalexamplesinpharmaandlifesciences

includeadverseeventreportingandPPSA-basedreporting

2. Descriptiveanalytics.Generatingactionableinsightsonthecurrentsituation

usingcomplexandmulti-variatedata.Typicalexamplesinpharmaandlife

sciencesincludemarketing,ReturnonInvestment(RoI)measurement,

customerjourneyanalysis,andcustomersatisfactionanalysis

3. Predictiveanalytics.Predictingthelikelyfutureoutcomeofeventsoften

leveragingstructuredandunstructureddatafromavarietyofsources.

Typicalexamplesinpharmaandlifesciencesincludecustomerlifetimevalue

analysis,revenueforecastingbasedonhealthoutcomes,andpredictionof

adverseeventoccurrence

4. Prescriptiveanalytics.Prescribingactionitemsrequiredtodealwith

predictedfutureeventsusingdatafromavarietyofsources.Often

associatedwithsimulationsinvariousbusinessscenarios.Typicalexamples

inpharmaandlifesciencesincludeElectronicHealthRecords(EHR)analysis

forinsightsintoearly-stagedrugdevelopment,marketingstrategyplanning,

andguidancetomedicalpractitionersonthebestmedical

procedure/approach

Theapplicationofpharmaandlifesciencesanalyticsfallsintothreekeyareas:

1. Regulatorycompliance/internalreporting

2. Marketing/salessupport

3. Product/serviceenhancement

TypicalanalyticsineachoftheseareasissummarizedinExhibit5.

Keyapplicationof analyticspharmaandlife sciences Regulatorycompliance/ Product/service Marketing/salessupport
Keyapplicationof
analyticspharmaandlife
sciences
Regulatorycompliance/
Product/service
Marketing/salessupport
internalreporting
enhancement

descriptiveanalytics

Reportingand

prescriptiveanalytics

Predictiveand

Adverseeventreporting

PVmasterdata

management

Regulatoryreporting

basedonSunshineAct

requirements

ForecastingPV

workloadbasedonpast

data

Marketingspendtracking

MarketingRoI

measurement

Customeraccountactivity

tracking

FirstCallResolution(FCR)

analytics

Customerjourneyanalysis

Brandreputationanalysis

Forecastingsalesbased

onpastmarketingRoIdata

Marketingbudget

estimationfornewdrugs

Revenueforecastingbased

onhealthoutcomesfor

providers

Revenueforecastingfor

pharmaceuticalfirms

basedondrug

effectiveness

Customerlifetimevalue

analysis/customerretention

Customersegmentation

Up-/cross-sellopportunity

analysis

Drugeffectiveness

reporting

Patienthealthoutcomes

tracking

Ratingofprovidersbased

onhealthoutcomes

Reimbursement

calculationsbasedon

healthoutcomes

Signalanalysistopredict

potentialoccurrenceof

seriousadverseevents

EHRandhealthoutcome

analysistodevelop

insightsintheearlystages

ofdrugdevelopment

Guidancetomedical

practitionersonthebest

medical

procedure/approach

7

E X H I B I T

5

Types of analytics in pharma and life sciences

EGR-2014-12-R-1160

ANALYTICS IN PHARMA AND LIFE SCIENCES Examples of regulatory compliance / internal reporting impact 
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

Examples of regulatory compliance / internal reporting impact

Increased timeliness and

accuracy of PV regulatory

reporting to over 90%

Replacement of multitude of

reports with a few more

insightful dashboards

Examples of marketing/sales support analytics impact

300% increase in cross- / up-

sell opportunity and also

increased customer

conversion rates

80% reduction in customer

churn

Increase customer satisfaction

scores by 25 to 30%

1. Regulatorycompliance/internalreporting.Theuseofanalyticshelps

organizationsensureregulatorycompliance,whileminimizingthecostof

ensuringcomplianceandmitigatingtheriskofnon-compliance.Thepeople,

process,andtechnologybeingputinplacetomanageregulatoryreporting

requirementsisalsohelpingorganizationsdobetterinternalreportingand

tracking,aswellasusethisfoundationforcomplex,high-impactanalytics.As

aresult,theburdenofregulatorycompliancecanbeconvertedintoan

opportunityforhighvalue-addinganalyticsimpactingthemarketing/sales

andproduct/servicedelivery.Forexample,thereportingrequirementsunder

PPSAhavecreatedanopportunitytobettertrackandpredictmarketingRoI,

whichwashithertoafuzzyandrelativelydifficultmetrictomeasure

2. Marketing/salessupport.Thevastamountofdatacollectedandclassifiedas

partofregulatoryrequirementshascreatedopportunitiesforenhancingthe

salesandmarketingfunctions.Forexample,themarketingexpensedata

collected,asrequiredunderthePPSA,ishelpingpharmaceuticalfirms

measuretheRoIfrommarketinginitiativesacrosschannels,products,and

locations.Also,learningfromthereportedinformationofcompetitorscan

helprefineandoptimizethemarketingstrategybasedonthemedical

practitionersbeingtargeted.

Thevastamountofinformationavailablefrommedicalclaims,health

assessments,healthscreenings,wellnessactivities,pharmacyclaims,and

generalcustomerinformationfromonline/socialmediasources,canbe

broughttogethertogeneratesignificantinsightsintocustomers,andhence,

aidthesalesprocess.Up-/cross-sell,customerlifetimevalue,andcustomer

retentionmetricscanbeenhancedwiththeaidofpharmaandlifesciences

analyticsoncustomerdata

3. Product/serviceenhancement.Adverseeventreportingrequirement,aspart

ofPV,andthemandatetodrivehealthoutcomesisleadingtotheintegration

ofclinicaltrialdata,hospitalrecords,physiciannotes,researchpapers,and

patientdemographicandcharacteristicsdata(includingdigital/socialmedia

information).Thisrichsourceofdatacanbeusedtocreateinsightstoaid

theearlystagesofdrugdevelopmentandtestingforpotentialadverseevents.

Also,thehealthoutcomeanalyticscanhelpguidemedicalpractitionerson

thebestmedicalprocess/approachbasedonanalyzingthepastdata,giving

practicalinsightsrelevanttopatientdemographic,location,etc.,todrivethe

bestoutcomes

Examples of product/service enhancement analytics impact

Drop in readmission rates

especially for critical ailments

8

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ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES Operationalizing Analytics in Pharma and Life Sciences – Challenges and

Operationalizing Analytics in Pharma and Life Sciences – Challenges and the Emerging Best Practices

Analyticsinpharmaandlifesciencespromisessignificantvaluecreation

potential,ifitisoperationalizedkeepingthefollowingthreesuccessfactorsin

mind:

1. Businessinsightsarecreatedusingdata

2. Insightsareusedtotakedecisiveaction

3. Resultsfrombusinessdecisionsarefedbacktoimprovedataandanalytics

further

This“data-to-insight-to-action”loopissummarizedinExhibit6below.

C ha lle nge : Lackof analytics-driven culture

1.Objective
1.Objective

Problem

definition/

hypothesis

creation

Setboundary

conditions

C ha lle nge : Lackof dataintegration

2.Data
2.Data

Extraction

Collection

Filtering

Categorization

Integration

Integrity

C ha lle nge : Lackof investmentintalent andtechnology

C ha lle nge : Lackof stakeholder alignment/collaboration

C ha lle nge : Lackof stakeholder alignment/collaboration 3.Insight 4.Action    Data contextualizing

3.Insight

4.Action

Data

contextualizing

Predictiveand

prescriptive

modeling

Outputvisualization

Enabledecision

making

Embedinbusiness

rules

Modifybusiness

processes

 Dashboardsand scorecards  Customreporting 5.Feedback  Learnfromactions  Improvedata collectionsources

Dashboardsand

scorecards

Customreporting

5.Feedback

 Learnfromactions  Improvedata collectionsources
 Learnfromactions
 Improvedata
collectionsources

Refine/adjust

objective

Improvedata collectionsources  Refine/adjust objective C ha lle nge : Ongoing relevance,validity,and improvement

C ha lle nge : Ongoing relevance,validity,and improvement

Operationalizinganalyticsinpharmaandlifesciencesrequiressignificant

investmentsoftimeandmoneyacrosspeople,process,organization,and

technology.Thissectionsummarizeskeychallengesthathealthcare

payer/providersandpharmaceuticalfirmsfaceacrosseachelementofthe

“data-to-insight-to-action”loop,aswellasidentifiessomeoftheemergingbest

practices.

Phaseof“Data-Insight-Action”

loop

1.Objective

Criticalchallengeinoperationalizing

analytics

Lackofanalytics-drivenculture

Thekeyenablerforanalyticsinthepharmaandlifesciencesindustryisthe

increasingregulatoryrequirement.Theneedforregulatorycompliancehas

driventhecollationandstandardizationofdata,whichcanthenbeusedfor

analytics.Whiletheorganizationscurrentlyconsiderregulatoryrequirementsas

anecessaryevil,theyaremissingoutontheopportunitytoderiveinsightful

analyticsbasisthefoundationprovidedbytheserequirements.

E X H I B I T

6

Typical challenges across the

“data-to-insight-to-action” loop

in pharma and life sciences

Need to look at regulatory requirements as an opportunity

Unexpectedly, PPSA has created an opportunity for competitive intelligence.

–The COO of global pharmaceutical major

9

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ANALYTICS IN PHARMA AND LIFE SCIENCES Theemergingbestpractice: Pharmaandlifesciencesorganizationsare
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

Theemergingbestpractice:Pharmaandlifesciencesorganizationsare

beginningtorealizethebenefitsofthestringentregulatoryregime.Theyare

alsorealizingthatthefoundationofdata,people,andtechnologycreatedby

theneedtomeetregulatoryrequirementsisaboontoderiveinsightsthrough

analytics.Organizationsneedtoovercometheinitialskepticismandembrace

thecultureofmakingdecisionsbasedonanalytics.

Phaseof“Data-Insight-Action”

loop

Criticalchallengeinoperationalizing

analytics

Lackofdataintegration

2.Data

Thedatarequiredtodrivepharmaandlifesciencesanalyticsisdistributed

acrossvarioussources.Datafromclinicaltrials,hospitalrecords,physician

notes,sales/marketingdata,claims,researchpapers,andpatientdemographic

andcharacteristicsneedstocometogethertodrivepharmaandlifesciences

analytics.ThedataalsorangesinformatfromstructuredEHRtovoice

recordingbyphysicians.Evenwithinanorganization,thetechnologysystems

acrossfunctions(clinicaldatamanagement,PV,CRM,andmarketing/sales)are

notintegrated.

Beyondtraditionaldatasources,organizationsalsoneedtotapintothevast

reserveofinformationondigitalandsocialmedia,whichisespeciallyhelpfulin

buildingcustomerdemographics,characteristics,andbehaviors.Thisdata,

then,needstobeintegratedwithtraditionaldatasourcestodriveenhanced

analyticssolutions.

Theemergingbestpractices

Mostpharmaandlifesciencesorganizationsaremigratingtodigital

records,leadingtohigherstandardizationandeaseofintegration.For

example,healthcareprovidersaremovingtoEHR,whichhasastandard

format.ThePPSAregulationallowspharmaceuticalfirmstoanalyze

marketingspendandcompetitordatatoderiveinsightswithrelativeease,

becausethedataisbeingcollatedinastandardformatacross

organizations.Advancementintextandvoiceanalyticsishelpingconvert

notesandrecordingsmadebymedicalpractitionersintostructureddigital

formats

Organizationshavealsostartedintegratingdataacrossdifferenttechnology

systems.Forexample,pharmaceuticalfirmshavestartedintegratingtheir

clinicaltrialdatawithPVdatatodrivebetteranalytics

Theneedtoleveragedatafromcommonsourcesisdrivingpharmaandlife

sciencesorganizationstocollaborateandshareinformationtoreduce

duplicationofeffort

10

The challenge of data sources

 

The key is to bring together the data from many different sources into one integrated data mart.

 

–The CIO of a U.S.- headquartered pharmaceutical firm

 

Availability of credible data is still a major issue. We are still not sure how clean our internal data is, let alone linking it with external data. –The CIO of a large healthcare company

 

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ANALYTICS IN PHARMA AND LIFE SCIENCES Lack of investment in talent and technology “  
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

Lack of investment in talent and technology

 
 

To do high-end PV analytics you

 

need to find talent with a unique

mix

of medical and statistical

skills, which is difficult to come by.

 

–The PV Lead in a European pharmaceutical company

 

 

There is not a lot of high-end health outcome analytics

happening due to a lack of data

and

talent.

–Analytics Lead for a healthcare payer

 

 

Inefficiencies due to functional silos

 
 

Our PV function has traditionally been run independently by the different BUs/geographies with almost no interface. –The COO of a large global pharmaceutical company

 
 

Phaseof“Data-Insight-Action”

loop

Criticalchallengeinoperationalizing

analytics

Lackofinvestmentintalentand

technology

3.Insight

High-endanalyticsinpharmaandlifesciencesrequirespeoplewith

medical/sciencebackgroundaswellasstronganalytical/statisticalskills,afairly

uniquerequirementthatisdifficulttofindinthetalentmarket.Also,high-end

predictiveandprescriptiveanalyticsisrelativelynewinpharmaandlife

sciences;asaresult,thereisalimitedtalentpoolavailablewithsignificant

experienceinthisspace,toleadthepracticewithinanorganization.

Beyondthetalentissue,organizationsneedtoinvestindatacollection,storage

(datawarehousing/businessintelligencetools),anddataanalyticstoolsfor

pharmaandlifesciencesanalytics.

Theemergingbestpractices

Therequirementforveryspecializedtalenttocatertoregulatoryregimes,

globally,relatedlanguagedependencies,andtheneedtomaintain24x7

operations,hasledorganizationstoadoptaglobalsourcingmodelwith

deliverylocationsacrosstheworld.Multiplelocationsalsohelpmanagethe

fluctuatingvolumesbetter,bydistributingworkacrossdeliverycenters

Theorganizationsareemployingthird-partyproviderstohelpexpeditethe

time-to-marketforpharmaandlifesciencesanalytics,bothfroma

technologyandanalyticsservicesstandpoint.TherearemultipleBPO

serviceprovidersandanalyticsspecialistsinthemarket,andtheirexisting

experiencecanhelporganizationsadoptthebestpracticesalready

prevalentintheindustry

Phaseof“Data-Insight-Action”

loop

4.Action

Criticalchallengeinoperationalizing

analytics

Lackofstakeholderalignment/

collaboration

Inmostorganizationstheanalyticsfunctionhasnotbeencentralizedand,asa

result,therearedifferentteamsacrossproductsandgeographiesthatare

sometimesinvolvedinreplicatingworkthathasalreadybeendonebyanother

group.Thisalsomeansderivingorganization-wideorglobaltrends/insights

becomesanuphilltask.Puttingpharmaandlifesciencesanalyticsintoaction

requiresdifferentBusinessUnits(BUs)tocometogether.Forexample,a

pharmaceuticalfirm’sstakeholdersacrosssales,operations,marketing,and

evenR&Dneedtocometogetherwithdataandinvolvementtoderiveinsights

frompharmaandlifesciencesanalytics.

Therearemultiplesetsofstakeholdersinthepharmaandlifesciencesindustry,

whichincludehealthcarepayers,providers,pharmaceuticalfirms,pharmacies,

HealthInformationExchanges(HIX),ACOs,researchgroups,anddigital/social

mediafirms.Currently,thereisareluctancetoworkacrossstakeholdergroups,

andevenwithingroups,astheyperceiveeachotherascompetitors

Theemergingbestpractices

Organizationsaretryingtocreatesharedservicesforpharmaandlife

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ANALYTICS IN PHARMA AND LIFE SCIENCES sciencesanalyticsbystandardizingtheirowninternalprocessesanddata
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

sciencesanalyticsbystandardizingtheirowninternalprocessesanddata

captureformats,whileallowingforvariationstoaccommodateregional

regulatoryrequirements

Theintra-groupcollaborationisontherise.Largehealthcarepayersare

creatinganalyticsorganizationsandprovidingservicestoothersmaller

payers.Thepharmaceuticalfirmsarecomingtogetherbysharingdatawith

eachother.Thehealthcareprovidershavestartedaligningtowardscommon

EHRformatsandalsosharinginformationamongthemselves

Phaseof“Data-Insight-Action”

loop

Criticalchallengeinoperationalizing

analytics

Ongoingrelevance,validity,and

improvement

5.Feedback

Predictiveandprescriptiveanalyticsneedtobefluid,dynamic,andopentoself-

learningandimprovement.Thisisnotaonetimeexerciseandneedsongoing

updatesandrefinements.Acontinuousfeedbackmechanismisrequiredfrom

frontlinesystems,whichishardtoimplement.

Mostvariableswithinananalyticsmodelaredynamicandchangecontinuously

overtime–customerdemographics,medicalprocedures,andeconomicand

regulatoryenvironment.Theanalyticalmodel,however,needstostayrelevant

andstandthetestoftime.Makingsurethatthepredictedandactualvalues

staywithinazoneofacceptableerrorisasignificantchallenge.

Theemergingbestpractices

Analyticalandsimulationmodelsneedtobedesignedkeepinginmindthat

theywillbeadjustedandrefinedovertimeandthereforebeself-learning

andflexiblesolutions.Forinstance,revenuepredictionsbasedonhealth

outcomesarecomparedagainstactualresults,andthemodelisthen

tweakedtoreducethepredictionerror

Offshorethird-partyserviceproviderscanalsobeutilizedfortestingand

ongoingmaintenanceofmodels.Thisenablesorganizationstokeepmodel

developmentandvalidationseparate,aswellasimprovescalabilityand

speed-to-market

Conclusion

Thepharmaandlifesciencesindustryisstillconsideringtheincreased

regulatoryoversightasaburdenandnotrealizingtheopportunitythatit

presents.Organizationsneedtoutilizetheadditionalinformationmade

availableasaresultoftheregulatoryrequirementsandmoveawayfroma

siloedapproachacrossfunctions.Theyshouldalsoutilizethefullimpactof

cloud,mobility,andsocialmediatoembraceanalytics-drivendecisionmaking

tocreatedifferentiationinanextremelycompetitive,dynamic,andchallenging

market.

This study was funded, in part, by support from Genpact.

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ANALYTICS IN PHARMA AND LIFE SCIENCES About Everest Group EverestGroupisanadvisortobusinessleadersonnextgenerationglobal
ANALYTICS IN PHARMA AND LIFE SCIENCES
ANALYTICS IN PHARMA AND LIFE SCIENCES

About Everest Group

EverestGroupisanadvisortobusinessleadersonnextgenerationglobal

serviceswithaworldwidereputationforhelpingGlobal1000firmsdramatically

improvetheirperformancebyoptimizingtheirback-andmiddle-officebusiness services.Withafact-basedapproachdrivingoutcomes,EverestGroupcounsels organizationswithcomplexchallengesrelatedtotheuseanddeliveryofglobal servicesintheirpursuitstobalanceshort-termneedswithlong-termgoals. Throughitspracticalconsulting,originalresearchandindustryresource services,EverestGrouphelpsclientsmaximizevaluefromdeliverystrategies, talentandsourcingmodels,technologiesandmanagementapproaches.

Establishedin1991,EverestGroupservesusersofglobalservices,providersof

services,countryorganizations,andprivateequityfirms,insixcontinentsacross

allindustrycategories.Formoreinformation,pleasevisitwww.everestgrp.com

For more information about Everest Group, please contact:

+1-214-451-3110

info@everestgrp.com

For more information about this topic please contact the author(s):

Eric Simonson, Managing Partner eric.simonson@everestgrp.com

Rajesh Ranjan, Partner rajesh.ranjan@everestgrp.com

Anupam Jain, Practice Director anupam.jain@everestgrp.com

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